Trump’s final Fed pick is extremely unorthodox

Trump's final Fed pick is extremely unorthodox

Judy Shelton has advocated a number of unusual policy ideas, including a return to the gold standard, which would link the US dollar’s value to the price of gold. America abandoned it in 1971.

The Senate is expected to vote and confirm Shelton next week.

For months, Shelton’s nomination lacked enough support for a full floor vote, even after the Senate Banking Committee approved her 13-12 along party lines in July. In September, Sen. John Thune, the Republican whip, told reporters Shelton didn’t have the votes.

But on Thursday, Republican Senator Lisa Murkowski indicated she would support Shelton’s nomination, all but guaranteeing her confirmation.

Senate Finance Committee Ranking Member Ron Wyden, a Democrat, said the decision for next week’s vote is “an effort to sabotage what little economic recovery we have by installing an unqualified, political pick at the Federal Reserve.”

Wyden also called Shelton’s ideas “wacky and outdated,” and said in a statement Thursday that “giving her authority over the dollar would be like putting a medieval barber in charge of the [Centers for Disease Control.]”

Shelton would serve out the remainder of the 14-year term of former Fed Chair Janet Yellen, which expires in February 2024.
In August, dozens of former Fed officials blasted Shelton in a letter, calling her views “extreme and ill-considered” and urged the Senate to reject her nomination.

If Shelton is confirmed, Trump will have filled five of the the seven governor seats on the Fed’s board.

“This would deny President-elect Biden the opportunity to fill seats,” said Kathy Bostjancic, director of US macro investors services at Oxford Economics, in a note to clients.

That said, current Fed Gov. Lael Brainard is one of the candidates who could be Biden’s pick to serve as Treasury Secretary in the next administration, which would leave her seat at the Fed vacant, Bostjancic said.
The Senate will also vote on the less contentious nomination of Christopher Waller as a Fed governor. Waller, currently the director of research at the St. Louis Fed, is considered a more conventional choice for the central bank.

CNN’s Ted Barrett contributed to this story.

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